Thursday, October 27, 2011


Little things like these make me feel better about the future:

Curry Parmesan: Sikhs rescue Italy's famous cheese
ZIBELLO, October 26, 2011 (AFP) - A master in the art of making Parmesan cheese, Manjit Singh is part of a large community of Sikhs in northern Italy who are shoring up an industry under threat of extinction.
Since moving from India seven years ago, the former taxi driver has become the main cheesemaker in a small family-run factory that produces thousands of rounds of the world-famous cheese.
Graziano Cacciali, who runs the Parmesan plant in Zibello, took Singh on as help in 2004 after undergoing a heart bypass operation and said he has enjoyed teaching him skills that Italians were no longer prepared to learn. 

This is an excellent example of how open immigration, and free exchange in general, makes everybody better off.

Economists usually do not pay much attention to 'culture' but it seems that Sikhs have been very successful in a lot of areas. They tend to impress the people they work with or for. The religion and culture has a lot of interesting parallels with Judaism. 

Anthropologists have a lot of different ways of describing group identity and its effects, but I think the economic concepts of branding and franchising also apply. I mean no disrespect with this analysis; it shows how good business models and good cultures solve similar problems in similar ways.

Think about how restaurant chains work. Many restaurants are run by people who are owners and entrepreneurs, not employees of an organization. The owner pays for the right to use a brand name, and agrees to adhere to the brand's quality rules. In exchange, the owner gets more customers, people who trust the brand. When the system works well, everyone wins. The biggest potential problem is quality control. Each individual restaurant owner has an incentive to cut quality to make money, taking advantage of the brand's good reputation. The company that owns the brand must control this with constant monitoring,  backed up with the threat of taking the franchise license away from bad owners.

'Sikh' is a brand owned and maintained by the community and religious leaders. Each individual Sikh is like a restaurant owner. They pay for the right to use the brand by committing to the religious rituals and beliefs. The turban and beard and kirpan are like a brand logo. The Sikh philosophy and teaching are the quality rules. The combination of a distinctive brand and well-enforced quality rules give the Sikhs an advantage over random people. Just like travelers will often go to a restaurant chain they trust rather than a local establishment of unknown quality, the Imperial British army and civil service preferred to hire Sikhs, and now Italian cheesemakers are also more likely to hire Sihks over random people.

An individual has an incentive to adopt the brand but fail to deliver the quality. This would reduce the value of the brand. The owners of the brand fight this by maintaining the power to excommunicate people who harm the brand. Therefore, it makes sense to put more trust a Sikh who sends credible and costly signals that his religion is very important to him. The more arbitrary and distinctive the religious commitment, the better.

This system can fail in one of two ways. The first way is for the brand to become meaningless through a gradual decline in standards. This would happen if the brand owners did not punish people who broke the standards. The second failure mode is paying more attention to the signals than the actual quality control. Imagine what would happen if the owners of a restaurant brand only cared about what the sign looked like but did not inspect the kitchen. A religion can fail in this way, when the leaders focus exclusively on the branding and logo aspects rather than the underlying quality of the human being. For a religious brand to be successful, there must be external signals to show that people are committed to the quality rules, but everyone must understand that the quality rules are more important than the signals.

And if the brand can avoid these two problems, success can bring its own risks. It is common for successful brands to be attacked by jealous competitors who cannot compete honestly. Jews suffer from this a lot, much like Wal-Mart and Starbucks, and there are isolated reports of similar things happening to Sikh children.

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